On January 1, 2018, Potter Corporation purchased 80% of Draco Company’s outstanding shares for $620,000. At that date, all of Draco Company’s assets and liabilities had market values approximately equal to their book values and no goodwill was included in the purchase price. The following information was available for 2018: Income from own operations of Parent, $150,000 Operating loss of Subsidiary, $20,000 Dividends paid in 2018 by Parent, $75,000 Dividends paid by Draco to Potter, $12,000 On July 1, 2018, there was a downstream sale of equipment at
On January 1, 2018, Potter Corporation purchased 80% of Draco Company’s outstanding shares for $620,000. At that date, all of Draco Company’s assets and liabilities had market values approximately equal to their book values and no
- Income from own operations of Parent, $150,000
- Operating loss of Subsidiary, $20,000
- Dividends paid in 2018 by Parent, $75,000
- Dividends paid by Draco to Potter, $12,000
On July 1, 2018, there was a downstream sale of equipment at a gain of $25,000. The equipment is expected to have a remaining useful life of 10 years from the date of sale. Also, on January 1, 2018, there was an upstream sale of furniture at a loss of $7,500. The furniture is expected to have a useful life of five years from the date of sale. Non-controlling interest is measured at fair market value.
How much is the consolidated net income attributable to parent shareholders’ equity?
A. 97,250
B. 115,050
C. 112,250
D. 103,050
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